Fun

Roaring Kitty faces securities fraud claims in ‘doomed’ GME lawsuit

News Feed - 2024-07-01 10:07:36

Tom Mitchelhill7 hours agoRoaring Kitty faces securities fraud claims in ‘doomed’ GME lawsuitKeith Gill is facing a new class-action lawsuit for his recent social media posts. However, a lawyer says the case is likely “doomed” to fail.4749 Total views12 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksKeith Gill, a stock trader known for the 2021 GameStop short-squeeze, is facing securities fraud claims in a class-action lawsuit over a recent spate of social media posts that saw the price of GameStop stocks whipsaw violently between May and June. 


However, a former federal prosecutor believes the lawsuit is likely “doomed” to fail.


Filed on June 28 in the United States District Court for the Eastern District of New York, the complaint intends to sue Gill for orchestrating a “pump and dump” scheme with a series of social media posts beginning May 13.Gill faces securities fraud allegations in a proposed class-action complaint. Source: CourtListener


The complaint alleges that Gill committed securities fraud by failing to adequately disclose the purchase and sales of his GameStop options calls, which allegedly misled his followers and resulted in losses for some investors.


Represented by law firm Pomerantz, plaintiff Martin Radev said he was injured by the alleged “pump and dump” after he purchased 25 shares of GameStop and three call options beginning in mid-May.Breaking down Roaring Kitty’s return


Gill emerged from a two-year social media hiatus on May 13, posting a series of cryptic memes to his X account, sparking a 180% surge in the price of GameStop shares, which rocketed from $17.46 to $48.75 by the close of trading on May 14.Source: Roaring Kitty


In a June 2 post to Reddit, Gill disclosed a sizeable position in GameStop, including five million shares of GameStop stock and 120,000 call options with an expiry date of June 21.


This sent the price of GameStop surging once again, closing above $45 on the day.


By June 13, Gill shared that he had exercised all 120,000 options calls, realizing millions of dollars in gains. Notably, he had used these gains to accumulate further GameStop shares.The price of GameStop shares whipsawed following Gill’s return to social media. Source: TradingView


The lawsuit claims that Gill did not sufficiently disclose his intent to sell his options calls ahead of time, which misled his followers and other market participants and resulted in losses for investors.Complaint is likely “doomed,” says lawyer


In a June 30 blog post from former federal prosecutor Eric Rosen — the founding partner at Dynamis law firm — Rosen said the class-action complaint is “doomed from its inception” and could be easily dismissed if Gill files a “well-crafted” motion to dismiss.


Rosen said the claim that Gill should have disclosed his intent to sell his options would not hold up well in court, as no “reasonable person, let alone a reasonable investor,” would expect Gill to hold onto all of their options until the exact time and date of their expiry.


Related:GameStop"s Roaring Kitty posts first livestream in 3 years— price reacts


Secondly, Rosen said as it was “clear” the plaintiff was seeking to profit simply from the price impact of Gill’s posts on X, not from the actual content contained in his X posts, it would be difficult to prove one’s status as a “reasonable investor” in a court of law based on this approach.“It is unreasonable to purchase securities simply because an individual named Roaring Kitty posted innocuous tweets on social media.”


Rosen said the most important part of pursuing a fraud case is proving that a fraudster has outright lied or intentionally misled investors by failing to disclose important information.


He explained it would be incredibly difficult to get past a judge, as a series of random memes posted by someone called “Roaring Kitty” on social media are not claims containing information that can be inherently proven or disproven.


Magazine —Polkadot’s Indy 500 driver Conor Daly: ‘My dad holds DOT, how mad is that?’# Law# Business# New York# United States# Stocks# Court# RegulationAdd reaction

News Feed

Bitcoin, Ethereum Technical Analysis: BTC Consolidates to Start the Weekend
Bitcoin, Ethereum Technical Analysis: BTC Consolidates to Start the Weekend Bitcoin was consolidating to start the weekend, as prices once again fell below $17,000. The move comes
Bitcoin Academy in Brooklyn Backed by Jay-Z and Jack Dorsey Airdrops BTC to Class Participants
Bitcoin Academy in Brooklyn Backed by Jay-Z and Jack Dorsey Airdrops BTC to Class Participants Rap star Jay-Z, otherwise known as Shawn Carter, and Block CEO Jack Dorsey, recently
Marcel Pechman10 hours agoBitcoin options tantalizing bears to push BTC price below $30K before Friday’s expiryBitcoin bears are closing in on a rare win, as they have the advantage in this week’s $600 million BTC op
Bitcoin, Ethereum Technical Analysis: ETH Remains Above $2,100 to Start the Weekend 
Bitcoin, Ethereum Technical Analysis: ETH Remains Above $2,100 to Start the Weekend  Ethereum remained above $2,100 to start the weekend, despite crypto markets moving into consol
Investor Lawsuit Argues Ripple Still Has to Answer Over Ongoing XRP Sales
Ripple’s argument that an XRP holder waited too long to file suit has no precedent, a new legal filing claims. Bradley Sostack, the plaintiff in a putative class-action lawsui
Meta Still Struggling for Its Metaverse to Find Its Legs
Meta Still Struggling for Its Metaverse to Find Its Legs Meta, the company formerly known as Facebook, is still struggling for its metaverse app Horizon Worlds to find its intended
‘Persistent inflation’ will be key in Bitcoin’s run to $200K — Crypto fund manager
Ivan Zhelev5 hours ago‘Persistent inflation’ will be key in Bitcoin’s run to $200K — Crypto fund manager“Unsustainable budget deficits” and “persistent inflation” have HashKey Capital analysts predicting
Hungary’s Prime Minister Says ‘Europe Has Run out of Energy’ Amid Russia’s Gas Standoff
Hungary’s Prime Minister Says ‘Europe Has Run out of Energy’ Amid Russia’s Gas Standoff Europe is suffering and struggling to contain an energy crisis according to various
Cardano Reclaims $1 As Network Growth Surges – Larger Breakout Ahead?
Este artículo también está disponible en español. Cardano (ADA) surged past the $1 mark over the weekend, marking a significant milestone in its recent rally. However, af
David Attlee1 hour ago9 US senators publicly back Elizabeth Warren’s crypto billSenator Elizabeth Warren announces the expansion of her coalition to crack down on “crypto’s use in money laundering, drug trafficking
Kucoin CEO Says Exchange Hack Suspects ‘Found,’ $204 Million Recovered
Kucoin CEO Says Exchange Hack Suspects "Found," $204 Million RecoveredAccording to the Kucoin exchange CEO Johnny Lyu, the trading platform has recovered $204 million in crypto asse
Kazakhstan Shuts Down Over 100 Crypto Mining Farms
Kazakhstan Shuts Down Over 100 Crypto Mining Farms More than 100 crypto farms in Kazakhstan have terminated operations as a result of ongoing inspections of the mining sector. Auth